438. Memorandum From the President’s Assistant for National Security Affairs (Kissinger) to President Nixon 1

SUBJECT

  • Meat Import Program for 1971

Two different options have been recommended by the agencies for setting the level of meat imports in 1971 under the voluntary restraint program. Agriculture and STR recommend no increase in 1971 over the 1970 level of 1,160 million pounds (Option III in the paper prepared by the Task [Page 1077]Force on Agricultural Trade, Tab A),2 for domestic political reasons. State, Treasury, CEA, and the Office of Consumer Affairs recommend increasing the import level from 1,160 million pounds to 1,300 million pounds (Option IV). The economic agencies base their views essentially on the anti-inflationary impact of the higher import level.

State’s recommendation is based principally on the implications of this program for our relations with Latin America. Eight Latin American countries voluntarily restrain their meat exports to us, and at least one more will probably have to be brought into the program next year. Implementation of these restraints has increasingly caused major frictions between us and these countries over the past two years. Although the difference in the levels involved is small for us, it is economically important and politically sensitive for the Latin countries.

I agree with State, and support Option IV. I recognize that 1,300 million pounds may be too high in domestic political terms; I would urge at least a token increase, however, to whatever level may be feasible in domestic terms. As State indicates, any decrease from the 1970 level would cause major foreign policy problems.

There are two major reasons why a liberalization of this program is now particularly important to our Latin American policy. First, in view of the Chile situation, we want to be particularly careful to maintain our friendships elsewhere in the Hemisphere, and to demonstrate that we will cooperate with the Latins on issues that matter to them if they will cooperate with us. The eight Central American countries, who are all suppliers of meat, will play an important role in our efforts to maintain the OAS sanctions against Cuba in the wake of Chile’s decision to recognize Castro and begin trade relations with him. In addition, Mexico is by far the largest supplier of meat in Latin America, and the new Echeverria Administration there will regard this as the first concrete test of our attitude toward it.

Second, there have been numerous sniping efforts in the Congress this year against Latin meat exports to us. The Senate Finance Committee trade bill, in fact, would “close some loopholes” in the existing Meat Import Act. A bill cloaked in environmental protection guise, passed by the House, would bar any imports from countries which did not control the use of pesticides as well as we do. Another bill, also passed by the House, would require all imported meat to be unfrozen for inspection at the border, which obviously would render it completely inedible.

Needless to say, these moves have made the Latins very nervous about the security of the U.S. market for their meat exports. Your decision [Page 1078]on the meat import level for 1971 provides the only foreseeable opportunity to take a concrete step which would reassure them.

There is also a foreign policy case for liberalizing the controls in terms of Australia and New Zealand, the two largest suppliers. We are making major efforts to keep both involved in Vietnam, and to join in helping Cambodia.3 Both regard our annual decision on meat imports as one of the major indicators of our interest in them, and our decision always occasions a great deal of political debate there. The Governments in both countries maintain only narrow margins in their Parliaments, and the alternatives in both would be much less cooperative with us in Southeast Asia.

Finally, it is by no means certain that an unchanged overall level of imports would offer sufficient bait to obtain continued “voluntary” restraints. It is virtually certain that any proposal for a rollback from 1970 levels would destroy the “voluntary” cooperation. The alternative would of course be to shift to quotas.

Recommendation:

I therefore recommend that you choose Option IV in the paper prepared by the Task Force on Agricultural Trade—1971 meat imports at 1,300 million pounds—or a level above 1970 which may be feasible in domestic political terms; I will work out the specific number with your domestic advisers if you approve the principle of an increase over the 1970 level, but decide that 1,300 million pounds is too high. I oppose any rollback from the 1970 level.4

Approve Option IV: 1,300 million pounds in 1971, an increase of about 11% over 1970

[Page 1079]

Prefer a smaller increase over 1970, the specific number to be worked out

Prefer Option III: 1,160 million pounds in 1971, the same level as in 1970

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Subject Files, Box 351, Meat Import Policy. Secret. Sent to the President in the week of December 21; see footnotes 3 and 4 below.
  2. Reference is presumably to a paper distributed to members of the Task Force by Houthakker on December 2 for a meeting that afternoon. Options III and IV described here are Options III and IV of the five options in Houthakker’s paper. (Ibid., White House Central Files, Houthakker, Box 17)
  3. On December 28 Bergsten and Holdridge sent Kissinger a memorandum reminding him that he had sent the President a memorandum the preceding week recommending the maximum possible increase in meat imports in 1971 under the voluntary restraint program. They recalled that the case had largely been couched in terms of Latin America, but they called Kissinger’s attention to Australian and New Zealand developments that strengthened the maximalist case. In particular, the New Zealand Ambassador had informed the State Department on December 22 that economic stringencies, in part due to limited beef exports to the United States, were reinforcing the New Zealand desire to withdraw its troops from Vietnam in 1971. (Ibid., NSC Files, Subject Files, Box 351, Meat Import Policy)
  4. None of the options below is checked. In a January 26, 1971, memorandum regarding the President’s decisions, Bergsten informed Kissinger that the President has not accepted his maximalist approach but had instead decided to hold imports constant at 1,160 million pounds. After reviewing the issues Bergsten explained his view of the bureaucratic dynamics that had resulted in Kissinger’s recommendation not being accepted. He reported that Hardin and Colson originally had supported 1,160 million pounds but then fell back at the last minute to 1,125 million pounds to enable them to characterize 1,160 million as a reasonable compromise. The final paper to the President, Bergsten wrote, was a composite drafted by Flanigan and did not present Kissinger’s “token increase” as an option. He complained that for the second time they had been “end-played” by Hardin and Colson “in the absence of any countervailing force of sufficiently high level to expose its absurdity.” (Ibid.)